TOP STORIES NO. 3: Hospital transaction finalized in the 11th hour

The public acquisition of Huntsville Memorial Hospital remains hung up in the courts over a year after the purchase was approved by a federal bankruptcy judge. 

During Wednesday’s meeting of the Walker County Hospital District, chairman Anne Woodard told board members that the creditors committee has continued to challenge the sale order of the hospital. She noted that the committee, which is composed of various unsecured creditors, lost its initial lawsuit against the hospital district last year.

However, that decision was appealed to the U.S. 5th Circuit Court of Appeals.

The appeals court has ordered oral arguments, which will occur the week of June 7 in front of the three judge panel. The appeals court will deliver its decision three to six months after the arguments are presented. If an appeal is granted, the case could either be sent back to the district court or bankruptcy court.

“We are hopeful that after the appeal we will finally be to the end of this,” Woodard said.


Local health leaders remain cautiously optimistic that state and federal leaders can reach an agreement, following a decision by the Biden administration earlier this month to rescinded an approved extension of the Medicaid agreement.

Texas has the nation's most uninsured residents and for years has refused calls to expand the federal health insurance program.

The Medicaid waiver provides funds to hospitals to offset their costs for treating uninsured patients and underinsured patients. The Medicaid expansion under the Affordable Care Act provides health insurance, so that patients have a means to pay their doctors, hospitals and pharmacies.

“We don’t know what the next step looks like,” said Steve Smith, the CEO of Huntsville Memorial Hospital. “The current administration is all about Medicaid expansion, and it sounds like this is just part of the negotiations. The 1115 waiver is a major part of our funding, but I truly believe that something will get worked out before the waiver expires in September 2022.”


Smith told members of the hospital district that admissions from COVID-19 continue to drop at Huntsville Memorial Hospital, with the virus taking up approximately 10% of all hospital beds last month. The hospital also recently lifted many of its visitor restrictions, allowing patients to have one guest at a time.

Smith also noted that hospital administration has recently signed agreements with a new OBGYN and a new orthopedic surgeon.


The next scheduled meeting of the Walker County Hospital District is scheduled for May 26. 

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